Red Sea Housing Services Co. acquired AM Modular Sdn Bhd, Malaysia, a company that designs and manufactures prefabricated modular buildings. The acquisition is Red Sea Housing Services’ first of its kind in Asia, and marks a significant expansion in the geographic footprint of the Company’s operations.

Under the terms of the agreement, the complete acquisition is valued at SAR 26.2 million (US$7 million), which includes a down payment of SAR 11.2 million (US$3 million) to be made this year. The remaining SAR 15 million (US$4 million) will be made over the next three-year period for a total of 90 percent of AM Modular’s shares.

Don B. Sumner, Acting CEO of Red Sea Housing Services Co., said, “Our acquisition today of AM Modular serves as a catalyst for Red Sea Housing Services’ expansion in the Southeast Asian market. It also fits perfectly into our innovation strategy, thanks to the unconventional construction technology that AM Modular brings to the table. This unique technology will enable Red Sea Housing to create high quality structures up to 12 floors high, with rapid turnaround times and using less manpower.”

Red Sea Housing Services expects its 2016 revenues to increase by over SAR 100 million following this acquisition. The deal will be financed through existing facilities and internal cash flow. The acquisition will be made by the Company’s subsidiary based in Dubai, UAE.